5 Things to Do Before Hiring Your First CPA
A certified public accountant (CPA) can do a lot for your small business. CPA´s can help you structure your business, save you money during tax season, represent you if you are audited, and even help with payroll and bookkeeping. Many small business owners hire a CPA around tax time, but it’s also a good idea to consult a professional finance firm before starting a business or making a big financial move. To prepare yourself, Project Victories offers a quick checklist to tackle before hiring your first CPA.
Familiarize Yourself with Different Business Structures
Whether you’re launching a business or making a major change to an existing venture, a CPA can help you choose a business structure that will save you the most money. The basic forms of ownership include sole proprietorships, partnerships, corporations, and limited liability companies (LLC´s). Make sure you’re familiar with the different types of business structures so you can work with your CPA to make the right decision. It’s also important to understand that the requirements for structuring a business vary by state.
Learn About Local Tax Laws
Tax laws can be tough to follow. This is why it’s best to work with a finance professional when it’s time to navigate your business taxes. Even if you plan on hiring professional help, it’s good to be familiar with the laws that apply to you.
Acquire Licenses and Permits
You cannot collect sales tax without obtaining a sales tax permit, so this is one of the many things you should do before hiring a CPA to help you set up your business tax strategy. Make sure you acquire the appropriate licenses and permits to operate legally!
Track Your Expenses
If you’re hiring an accountant to help you save money at tax time, prepare and organize all of the documents they will need to deduct your business expenses properly. You must be able to show that the expenses you want to deduct are related to your business rather than for personal pleasure. Sometimes, a receipt is not enough proof. You must maintain records that document the business purpose for each expense you intend to claim on your taxes.
Ask the Right Questions
Finally, before you hire a CPA, ask them a few questions about their expertise and experience. Find out exactly what services they offer and what they don’t. Ask about their fees to ensure their compensation model works with your business budget. It’s also a good idea to find out if your CPA has experience working with other businesses in your industry, especially if you operate in a very niche market. Importantly, make sure your CPA is registered in Texas!
When it comes to business taxes and other financial matters, it’s easy to get in over your head. Work with a finance professional who can help you develop your small business tax strategy so you can keep more money in your pocket.
For more insight and advice about running a business and how to make it successful, bookmark the Project Victories blog.
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